When an independent store decides to go into partnership with a symbol group, there are many factors that need to be considered. Here, Spar UK outlines some of the key factors that need to be looked at before making the all-important choice of symbol partner.
Symbol groups are collections of stores which are contractually affiliated to a wholesale symbol group provider. The symbol group wholesaler provides the fascia and should provide symbol group retailers with a range of other supporting services, including the shop branding, access to own-brand products, negotiating promotions with suppliers, IT services, stock delivery and logistical support.
However, each independently owned store can retain a degree of independence from the symbol group wholesaler, the extent of which may differ depending on the contract and the business model in place.
Symbol group criteria
When an independent retailer looks to choose the right symbol group partner for their business, a number of factors need to be considered. Joining costs, the contract, advice, brand strength, buying power, minimum drop requirements, access to an own-label range, marketing and digital programmes, fresh and chilled availability, wastage, and BDM support are just some of the considerations that need to be taken into account.
Spar UK retail director Ian Taylor says: “Joining a symbol group is a personal business decision between an independent retailer and a particular fascia group and it should reflect how the long-term relationship can mutually benefit both parties. It is a big commitment, overwhelming at times, but if the right decision is made, retailers can reap the rewards. Each symbol group has its own criteria and Spar is no exception.
“There might also be a cost associated to bringing stores into that symbol group’s minimum store standard requirement and a minimum purchasing commitment. Everything needs to be looked at. We try to help stores when they join by offering them free membership to Spar for a year and free ACS membership.”
Access to an excellent range of own-label products offering customers everyday value is something every symbol group retailer should be able to rely on. An own-brand range that has been designed to help stores stand out from the competition is crucial today.
A good own-label range should keep customers coming back for more. The offer should be relevant not just to consumer shopping needs for choice and value for money, but it should also deliver on quality.
As an own-brand offer within the convenience channel, Spar delivers a unique independent retailer opportunity to deliver Spar-branded ranges in only Spar fascia stores.
Paul Stone, Spar Oxford Road, Manchester
Paul Stone says: “The Spar own-label range of products is the single biggest opportunity to drive shopper satisfaction and loyalty. Exclusively available in only Spar stores, the Spar own-label range has close to 1,000 products across every category.”
Fresh – the key to a successful convenience offer
One of the key product areas to get right if retailers are to compete in today’s aggressive convenience market is fresh foods. A store with a good fresh offering not only enjoys more customers, but a higher customer spend.
Over the years, symbol groups have taken major steps to ensure that ranges stay up to date and in line with the latest customer trends. They should provide extra resources and personnel to achieve a high penetration of fresh products in stores and retailers should receive support to make the most of the growth opportunity.
Peter McBride, Spar Omagh
Peter McBride says: “A core focus of my business is to offer a fantastic and high-quality range of produce, hot food, dairy and bakery to shoppers. In order to exceed in this, I need to work with a partner who can support me every day of the year. The service I get from working in partnership with the Henderson Group allows my stores to focus on delivering every customer shopping mission.”
Dedicated business development managers (BDMs) should be employed to support retailers’ ongoing business needs. Friendly and helpful, they are highly skilled to help retailers with front-line support in store operations, store standards and compliance, along with developing sales, margins and business management.
Visiting stores and being at the forefront of what retailers are experiencing is hugely important in understanding what independent retailers are facing daily. “BDM teams provide a wealth of experience and expert knowledge to ensure forward-thinking business plans are delivered, aiming to drive sales growth and increase cash profit,” says Taylor.
Julian Taylor-Green, Spar Western Downs
Julian Taylor-Green, Spar Western Downs, says: “Our dedicated BDM is very friendly. She is at hand to help us with front-line support in store operations, store standards and compliance along with developing sales, margins and business management. She is always ready to challenge our views and opinions. The support that’s available is incredibly helpful.”
Whether a store refit or a refresh is planned, symbol groups should offer co-investment opportunities to help turn dreams into reality. Modern, customer-focused, energy-efficient solutions to increase footfall and basket spend should form part of the offer. An unrivalled in-store design package, backed by an understanding of customer shopping missions that drives sales and profit, is crucial to attracting customers.
“We know that the ‘one size fits all approach’ is not good enough when operating in many diverse locations. Our store programme is adaptable both in the range of formats on offer and in the flexibility of solutions to take into account the size of investment monies available,” says Taylor.
From small stores to large store projects, neighbourhood stores, to city centre stores, forecourt to transient stores, Spar has a format development programme that will add value to the store offer, bringing more footfall and encouraging higher spends.
Seb Hawtree, Spar at Riverside Garage, West Stour
Seb Hawtree says: “Our customers are bowled over by what we have achieved with our new Spar store. We now have extensive parking on-site for up to 40 vehicles and a store that meets everyone’s grocery needs.
“The transition from the old store to the new could not have gone better. As a family business our aim is to keep every customer happy. We are committed to the Spar brand and hope to add more stores to the portfolio in the future under Appleby Westward’s supply.”
Symbol groups looking to support retailers need to approach marketing with innovative and proactive tools. These should consist of TV advertising, digital to in-store radio, from promotions to local community programmes as and when they are seen to be most effective.
Underpinning all marketing decisions should be an in-depth knowledge of what customers want from their local convenience store, based upon active and ongoing customer research.
Nicole Murray, Spar Dornoch
Nicole Murray opened her second Spar store in Dornoch Business Park. She says: “I was so excited to take over the Dornoch store. It was a busy few months revamping it, but I was so grateful for the support I got from Spar Scotland. They helped bring the store to the attention of local shoppers with a huge marketing and store launch programme and I’m delighted to see the same customers and more still using the store.”
Making the right decision
A lot has to be taken into consideration when choosing the right symbol group. It’s a long-term financial decision that should positively affect the future of a business. Spar is confident that it will remain a sector leader because it adapts to change, implements world-class solutions and innovation with greater collaboration between retailers, RDC shareholders and suppliers.
Taylor adds: “Independent retailers looking to make the switch need to look at all the options available in order to find the right symbol family for them. Everything needs to be taken into consideration – stock allocations, retail technology, strength of the brand, the people, training, BDM support, rebate schemes, competitors analysis. The list is endless, but the rewards can be bountiful.
“We know what retailers want because we recognise that there is no such thing as a typical independent store, and we have the ability to service a wide a variety of independents with varying needs. Our long-time market leadership has not resulted in complacency. Our performance is something Spar retailers can be proud of as our business continues to perform well ahead of the market.
“We’ve had 10 years of consecutive growth, and we are in great shape for the future.”